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Top-tier entrepreneurs, legal eagles, talk about the value of patents, IP, in the biomedical innovation sector
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PROVIDENCE – It was, as Jason Harry described it, a learning moment in the innovation ecosystem.
Harry, an associate professor of the Practice, Engineering, at Brown University, was performing as emcee at an intimate forum sponsored by the Technology Ventures Office at Brown, held on Feb. 23 at the Warren Alpert Medical School.
The forum featured an impressive array of experts: Dr. Barrett Bready, founder and CEO of Nabsys; Patrice M. Milos, president and CEO of Medley Genomics; Charlene Stern, senior director of IP and legal affairs at Editas Medicine; and Daniel J. Holmander, a patent attorney at Adler Pollock & Sheehan.
Harry himself came to the discussion with chops as an entrepreneurial innovator: he had founded and served as CEO at Lucidux, an early stage medical device firm, and he also had founded and served as CEO at Afferent, a company that developed neurostimulation techniques.
Harry introduced the panel as a dream team with decades of expertise when it came to valuing investment and intellectual property, or IP.
“We could start a consulting company and charge $2,500 an hour,” Harry said, with the panelists each getting $600 an hour and him getting a modest $100 an hour.
Fast moving discussion
The fast-moving discussion, which could have been packaged as a feature story in Fast Company, had a “ripped from the headlines” approach to the legal necessities of finding and protecting IP in the biomedical world.
Stern is the legal director of IP at Editas Medicine, a pre-clinical firm that has an exclusive license on the Broad Institute’s patent on human therapies applications with CRISPR. When Broad recently won its legal patent case for its CRISPR work, Editas Medicine may have been the biggest winner.
As Harry told the audience, Editas Medicine, now a publicly traded company, gained $200 million in value the day after the decision was announced, a 40 percent increase in market value.
“IP is something we’ve invested in,” Stern said, labeling it a key ingredient of the company’s success. As a result, and assuming that the patent situation does not change, Editas Medicine will be a major player in human CRISPR therapies in the foreseeable future, according to news reports.
The rise, fall and rise of Nabsys
Bready, the founder of Nabsys and who recently returned as CEO, briefly introduced himself as someone who found his calling not as a practicing physician but as an entrepreneur working with for-profit platforms on genomics. “IP is important,” he said, succinctly.
Legal guardian of the galaxy
For Holmander, the role he plays as a patent attorney is one of a protector of IP, in the way that patent applications are drafted.
Harry asked Holmander if he ever got the urge to try his own hand at innovative ideas to launch a venture.
Holmander demurred, saying: “I look at innovators as incredible artists. I am in awe.”
A license to innovate
The story of Medley Genomics began in 2016 with a meeting at the JP Morgan life sciences gathering in San Francisco which attracts some 25,000 each year, when Milos met and talked with Katie Gordon, the director of Brown’s Technology Ventures Office, about acquiring the license from Brown for some complex genomic algorithms related to developing new approaches to cancer therapy.
Milos did what Harry described as “due diligence,” which included talking with Bready.
More than just starting a company, or having “excellent” IP, Milos continued, “The real talent is [the ability] to survive.”
At a previous company, Helios BioSciences, Milos had been the one who had turn out the lights when the company folded, according to Harry. The company had raised $150 million in venture capital investment.
The IP and the venture capital investment, Milos continued, “did not guarantee commercial success.”
The spectrum of IP value
Bready drew the distinction between principal investigators [PIs] in an academic research center and intellectual property [IP] created by the researchers.
“Principal investigators don’t leave academia,” Bready said. In turn, he continued, “A company is not the commercial [extension] of the lab.”
In response to a question by Harry about the importance of IP for an early stage life sciences company, Bready sketched out a spectrum of the relational value of IP correlated with the amount of time and money invested needed to bring a product to market.
At one end of the spectrum were companies such as Amgen and Biogen, where the costs of developing a drug and getting it approved for the marketplace could take hundreds of millions dollars and more than a decade, for which IP importance was crucial to success. At the other end were diagnostic medical devices with a short turnaround for market entry and perhaps a short shelf life.
Holmander described the value equation around IP as “the freedom to operate,” both here in the U.S. and globally, correlating to the stage of the company and its budget.
For Stern, protecting the intellectual property through patents for the use of CRISPR was an important corporate strategy. The technology, she explained, raised the question: “What could we do if we could repair a broken gene and make a very precise edit in the DNA?” The answer, Stern continued, was: “This was a game-changer in harnessing the technology.”
In turn, Editas Medicine was able to raise $43 million in a Series A investment, even without a patent issued.
In filing for patent protection, the first step is filing for a provisional application, which provides 12 months worth of protection, according to Holmander. A key to protection in potential legal conflicts is the date stamped on the provisional application, he continued.
In response to a question from a researcher at Brown, about whether to publish findings or whether to file for protection of the intellectual property, the panel members concurred that it was important to file first and then submit for publication, something that they admitted contradicted a lot of the workings of collaborative research now underway..
The panelists also said it was important to document research findings in lab notebooks.
That said, Holmander said, “Just because you can file for a patent, it doesn’t mean you want to file for a patent.” Getting a patent, he continued, “is not an easy process.”
Much of the legal work for patents centers round what he called “pothole detection.”